Oregon Trial Court Rules Church Must Disclose Financial Information

The Oregon Supreme Court has apparently rejected an appeal of a trial court ruling on a very limited issue that the Church turn over financial information in a case that is scheduled to start in August on sexual molestation claims. Media reports are from OregonLive.com and from the Salt Lake Tribune, and a few other outlets, essentially carrying the same story.

The Oregon Supreme Court rejected an effort by the Mormon church to withhold financial information from the lawyers for a man who claims a “home teacher” frequently molested him about 20 years ago. Despite the legal defeat, the Church of Jesus Christ of Latter-day Saints did not immediately release the detailed financial information about its net worth, The Oregonian newspaper reported.

Kelly Clark, an attorney for the Oregon man suing the church, said it would be good for a jury to have the information before considering his request for $45 million in punitive damages. A trial is scheduled for Aug. 6. “A jury needs to know the entire financial context to know whether a punitive award is too much or sufficient or not enough,” Clark said.

Since the case has not yet even been tried, it seems premature to be discussing the possibility of punitive damages and forcing the Church to disclose its financial information. Mr. Clark’s suggestion that a jury needs to know the entire financial context of the Church’s financial matters to know whether a punitive award is too much or not enough is just nonsense.

First, the trial hasn’t even begun. So, clearly there is not any need to even consider a punitive damage award. Second, the plaintiff will likely have a greater evidentiary burden to establish conduct that would support a punitive damage award, as opposed to the very low evidentiary threshold of a mere preponderance of the evidence to establish negligence. We ought to have the jury hear the evidence to:

1. Establish liability in the first place;

2. Establish whether by clear and convincing evidence there was conduct sufficient to even warrant the consideration of punitive damages.

The media reports are that the Church appealed the trial court ruling that it must disclose its financial information. The Oregon Supreme Court rejected the Church’s appeal. I don’t know at this point whether that means the supreme court actually considered the appeal on its merits or just rejected the opportunity to hear it–probably the latter:

The LDS church sought emergency relief from a trial court order to turn over the financial information, but the Oregon Supreme Court late Monday rejected the appeal. The pretrial decision was reached on narrow pretrial grounds and doesn’t mean the court would not ultimately side with the church’s position that the Constitution protects its right to keep financial information private.

“The church is considering its position,” Stephen F. English, the LDS church’s lead Portland attorney, told the newspaper. “The church respects the rule of law but has profound constitutional concerns based on its constitutional right to protect the free expression of its religion.” The LDS church has not released financial information since 1959.

The Church is right to be concerned about its constitutional rights in this case. The First Amendment is at stake here, including the free expression of religion. Disclosing financial information without there even being a verdict poses a grave risk to First Amendment Religious freedoms.

The lawsuit apparently stems from allegations of sexual abuse from a home teacher. Of course, that is a far cry from the Church or any of its agents knowing about any alleged abuse, or having any responsibility for such abuse, even assuming that it occurred:

The latest bid to expose the church’s net worth stems from a lawsuit filed last year that accuses Kenneth I. Johnson Jr. of molesting a Beaverton youth as often as twice a week in the late 1980s. Johnson, who has denied the accusation, was the boy’s home teacher, a church-sanctioned lay official authorized to provide educational and religious guidance, according to the suit.

English said Johnson was acting as a family friend, not a church official, and LDS church officials did not know about the alleged abuse while it was happening.

I think the plaintiff here is going to have an uphill battle even establishing any liability by the Church. A home teacher is a far cry from a bishop or pastor or priest of another religion. The alleged activities could very well have taken place, as English points out while the accused was acting as a family friend and not on behalf of the Church. Regardless, it is way too soon to require the Church to disclose its financial information.

An Oregon Supreme Court ruling ordering the LDS Church to release detailed financial information to an alleged abuse victim could have wide-ranging implications for the church, which has not disclosed its assets publicly since 1959.

The plaintiff in the Oregon case, who alleges repeated sexual abuse by his LDS “home teacher,” argues that knowing the church’s net worth is necessary to help a jury decide if $45 million in punitive damages is reasonable. The church counters revealing such information would violate its religious rights.

Again, there is a real problem with this argument that a jury needs to know the financial worth of the Church to determine whether $45 million is enough. The fact is that this plaintiff has so far proved nothing. There is no verdict. There is no finding of liability by any jury against the Church. There is no finding of any damages for which the Church is responsible. There is no finding by any evidence whatsoever that the Church or any of its agents acted with oppression, malice, fraud, or in conscious disregard, conduct which is usually required to support punitive damages.

I haven’t seen the ruling so it’s hard to determine exactly what the court ruled. The media stories don’t publish the ruling (which they may not have), and don’t state when the judge ordered the information turned over. It would be helpful to know this information. I would also point out that I disagree with Ms. Fletcher’s opening sentence. From what I have read, the Oregon Supreme did not order the Church to turn over financial information. This was a trial court order, that the Church appealed to the Oregon Supreme Court, likely on an emergency appeal. The Oregon Supreme Court just declined to hear the appeal, which is a far cry from ordering the Church to turn over anything.

But the case has drawn renewed attention to The Church of Jesus Christ of Latter-day Saints’ insistence on keeping its assets confidential, although it certainly is not alone among churches in the practice.

The federal government does not require such disclosure and few religious groups do so voluntarily, said Dan Busby, vice president of the Evangelical Council for Financial in Winchester, Va.

Still, Mormonism is unique in the way it collects tithes and offerings from local church units into a common pool at its Salt Lake City headquarters, then disperses the money to areas as needed. An all-volunteer clergy governs the church, but chapels and temples, missionary allowances and educator salaries are paid out of general church funds.

Because LDS assets are listed together, rather than by region, financial disclosure of any part of the assets would reveal all the church’s holdings. To Mormon leaders, that’s an unfair expectation.

“I’m not aware of any group or denomination that would funnel all money into the central repository. That would be totally unheard of in Protestantism,” Busby said. “Most denominations require that local churches pay a percentage or per capita amount to headquarters, but usually only 10 or 15 percent used to fund headquarters operations.”

This is interesting. While I knew the Church funneled money to Salt Lake City, I did not know that it was mostly a unique practice among churches today. The article then points out another argument that I did not even consider:

Even the Catholic Church, which has a centralized leadership at the Vatican, is financed at the diocesan level. That’s why several U.S. dioceses have filed for bankruptcy after being hit with millions of dollars in abuse awards, but no one asked to see all the Vatican’s records.

It does seem a bit overreaching to require all the Church’s financial records, including its worldwide resources. If I can obtain any of the primary documents I will share them.

Update 7/13/07 8:30 am. Justin over at the Mormon Wasp has kindly provided me with some links that appear to relate to a prior Oregon case brought against the Church, which was ultimately settled for some $3 million. The other link is related to the case currently in litigation. Thanks Justin for the links:

Portland, Oregon — An man who claims he was abused by a home teacher from The Church of Jesus Christ of Latter-day Saints is suing the church for at least five million dollars.

The unnamed plaintiff accused home teacher Ken Johnson of regular and repeated sexual abuse from 1986-1988 in Beaverton.

Mormon church spokeswoman Kim Farah, at church headquarters in Salt Lake City, says church leaders learned of the incident in 2001.

She says they reported it to authorities, who declined to prosecute because so much time had passed.

She said counseling was offered to the victim and Ken Johnson was excommunicated in January 2002. Excommunicated Mormons can attend services but are barred from church positions of responsibility and from the sacraments.

This last link is the one that appears to be directly related to the current case in litigation in Oregon. A couple of quick points:

1. The alleged abuse occurred in 1986 to 1988, yet the Church is not notified until 2001.

2. The abuse is alleged by a home teacher, not a bishop, stake president or other actual priesthood leader in authority over the alleged victim;

3. No underlying criminal prosecution or verdict against the alleged perpetrator because so much time had passed, yet he was apparently excommunicated.

For a rather extreme and opposite point of view, please see this post over at Loaded Orygun, where the author seems to think the Church would be civilly liable for any abuse by a home teacher if they failed to do a background check on each and every home teacher in the Church. It’s a bit far out; but, it does present a different point of view.

Yes, I believe you are correct. From the media reports, it sounds like the Church is making some federal Constitutional claims. Assuming that to be the case, the Federal Courts are always the last authority on those issues.

I haven’t seen any of the moving papers so it’s hard to know all the claims. It would be interesting to know whether they are also making any state constitutional claims as well. Regardless, I think it way too early to be forcing the Church to disclose anything, unless and until there is some verdict, and one that would support the award of punitive damages.

I’m sure you’re right. The myriad of Catholic cases come to mind. I don’t know the specifics on those.

And, each state jurisdiction will have varying laws in terms of what financial information is discoverable before trial, and what actually has to be given up after trial post verdict that might support a punitive damage award. But, you raise a good question, that frankly I don’t know the answer to.

Thanks for this summary, Guy! This is both a state and federal issue, no? I think about six states do require some level of financial disclosure by religious institutions – treating them pretty much like any other non-profit charitable organization. These state financial disclosure requirements don’t seem to be violative of the First Amendment.

In the Catholic Church clergy abuse situation, the Catholic Church voluntarily disclosed financial information as part of the settlement negotiations with victims of abuse. Also, the Catholic Church has historically been more open with its financial records (although nothing like pure transparency) – particularly when compared with the LDS Church. One of my friends used to sit on his Parish Finance Council, which kept track of donations and decided how to spend the Church’s money. His parish routinely disclosed this information in an annual report to its parishoners.

Do you know if the LDS Church has been willing to settle the Oregon case out of court?

While I understand your arguments from a “right and wrong” viewpoint, Guy, perhaps I can shed some light on procedure. (I’ll qualify this by saying I practiced in Illinois, not Oregon.) I want to make it VERY clear that I am talking about procedure here, and not making any judgment whatsoever as to this particular lawsuit, the LDS church’s potential liability, etc.

Ordinarily, financial information of a defendant is inadmissible in a personal injury matter of this kind. The one exception is when a demand for punitive damages has been approved.

You will notice that I said “approved.” Long before a matter comes to trial, a plaintiff who wishes to seek punitive damages is required to provide evidence to the judge which justifies such a demand. For example, I did this in a case against a large airline. My colleagues and I presented two thick binders of evidence, showing that the airline had tracked our same problem for over ten years, that it was happening every 1.5 days on average, and that the airline’s marketing department had actually vetoed the proposed safety correction on the basis that it might cause a negative perception for customers. We had to prove to the judge, in essence, that the airline’s conduct was so unconscionable as to almost reach the point of “criminal” misconduct. We did so, and were allowed by the judge to add a demand for punitive damages. This did *not*, mind you, mean that we would actually get them–that was for the jury to decide. Still, the matter had to be factually and legally analyzed by the judge before any such request could be put before a jury.

Now, what does this have to do with financial information? IF the jury finds liability, and the judge has allowed a demand for punitive damages, THEN the plaintiff is allowed to show evidence of the defendant’s financial status. Punitive damages have little to do with how bad the harm was (that would be compensatory damages). Punitive damages are just that—they are “punishment,” intended to dissuade the defendant and other similar entitites from acting in the same way again. Now, a financial penalty that would “punish” you or I would mean absolutely nothing to a large corporate airline which makes millions in daily sales. Therefore, the jury is allowed to consider the airline’s income, in order to essentially determine what kind of “punishment” will actually get the airline’s attention.

In this case (assuming Oregon is like most states, requiring the above procedure before a demand for punitives can be made), the trial judge had to view evidence and reach a legal conclusion that the alleged behavior was serious enough (usually meaning repetitive, as well as “bad”) to justify a demand for punitives IN THE EVENT that the jury finds liability. The trial judge would almost never order a defendant to disclose financial information, unless leave had already been granted to make a demand for punitives. If that leave has been granted (and only then), the financial information of the defendant becomes relevant and discoverable by the plaintiff.

Again, I am making absolutely no judgment as to which party in this lawsuit is “right,” or whether the LDS church is liable for anything at all. I’m merely pointing out legal procedure, as I think your argument above doesn’t take that into account.

I would love to see, by the way, an actual brief by the LDS church’s attorneys, on how they think court-ordered disclosure of financial information in a personal injury case with punitive damage potential is an infringement on the constitutional “free expression of religion.” I’m not saying they’re right or wrong, just that I can’t quite wrap my head around the idea. I’m a big proponent of religious freedom, so I’d love to see a convincing argument.

Okay, one more point (sorry for the multiple posts). Guy, you suggest that disclosure shouldn’t be forced until after a verdict finding liability. The problem with this is that the plaintiff has the right to prepare their case. If the information was not disclosed until after a liability verdict, they would have no opportunity to analyze the information and prepare their presentation of it.

Mind you, the court can (and upon the LDS church’s motion likely would) issue a confidentiality order which limits how and when the plaintiffs may disclose any of this information. A full “public” disclosure isn’t likely to be necessary.

This is both a state and federal issue, no? I think about six states do require some level of financial disclosure by religious institutions – treating them pretty much like any other non-profit charitable organization. These state financial disclosure requirements don’t seem to be violative of the First Amendment.

Probably yes and no. How’s that for a law school exam answer? 😉

Like Nick’s disclaimer in one of his comments, I do not practice law in Oregon; but, if I had to guess, I would say Oregon probably has similar Civil and Civil Procedure code provisions to CA.

I understand that MA had introduced one of those sunshine bills. There’s an interesting discussion of it here. You probably know much more about this particular law than I. Did it pass? Has it been constitutionally challenged? I don’t know.

One problem I have is that Churches are not just like any other non profit organizations. Religious worship is at the core of our First Amendment protections, probably even more core than Freedom of Speech (if such a thing were possible). As the author of that article points out, Churches are not just like the little league.

The other issue is that the financial disclosure I assume you are addressing deals with sunshine laws requiring churches to be more open in their financial dealings. What the Oregon case is dealing with is something completely separate and distinct.

The Oregon plaintiff wants to force the Church to disclose its financial information (I don’t know what kind or what the extent of the request is). And, he wants to do that before he has even obtained a verdict from any trier of fact. He hasn’t proved anything yet, let alone damages.

It’s unclear to me; but, from the Oregon media link it sounds like the punitive damages may only be sought against the individual defendant, rather than the Church. If so, I’m not certain whether the Church’s financial wealth is even relevant to the case at all. But, assuming the Church is a named defendant, at least in CA, the corporate entity can be liable for punitive damages only if an officer or director knew in advance of the wrongful conduct, and acted with conscious disregard, or if afterward they ratified the conduct. Hard to believe on what limited facts we know about this case.

In CA, a plaintiff generally is not entitled to discover financial wealth of a defendant, unless after a hearing, the court finds the plaintiff has presented admissible evidence showing a substantial likelyhood he will prevail on the merits of his claim. That rarely happens, at least in my experience in CA.

Couple this with the constitutional claims, and the little factual information we have, I am a little surprised the trial court has ordered disclosure of financial information.

Do you know if the LDS Church has been willing to settle the Oregon case out of court?

I don’t know; but, from the media reports it sounded like the Church did settle one prior case for a rather substantial sum. So, I expect in the right circumstances the Church, like any corporate defendant does consider the possibility.

Like you, I don’t practice in Oregon; but, as I discussed very briefly in my response to ECS above, the procedure for CA, sounds somewhat similar to what you describe. One difference out here is that anyone with $320 and a computer can allege anything they want, including punitive damages, and file their lawsuit in a court of law. They don’t have to get leave of court to allege punitive damages.

What a plaintiff does have to do, if they want to overcome the statutory prohibition against the discovery of financial information, is that they have to present admissible evidence showing the trier of fact that there is a substantial probability that he will in fact prevail on the merits of his claims at trial. Then and only then might the court grant a motion allowing the discovery of financial worth.

That is not the same as allowing the admissibility of that discoverable information. The plaintiff would still have to wait until after he actually obtained a verdict and the jury found by clear and convincing evidence (at least in CA) that the defendant acted with fraud, malice or oppression. Here a plaintiff would have to prove by a preponderance his personal injury claims. On top of that if he wanted to be able to present his punitive case, he would have to prevail by clear and convincing evidence those claims.

Guy, you suggest that disclosure shouldn’t be forced until after a verdict finding liability. The problem with this is that the plaintiff has the right to prepare their case. If the information was not disclosed until after a liability verdict, they would have no opportunity to analyze the information and prepare their presentation of it.

Not so. I’ve defended a punitive damage case through trial before. What happens is that if the plaintiff proves his personal injury claims, and also by clear and convincing evidence shows the defendant acted with oppression, fraud or malice, and in conscious disregard, then the court will grant a recess of however long needed for the plaintiff to prepare on that one issue of financial worth.

Usually during the course of litigation the defendant may be required to at least identify documents that would show financial worth and also identify witnesses to testify if that part of the case went forward. The plaintiff could then subpoena those documents and witnesses to trial a week or so later and the case would resume.

There’s not really much to it actually.

In this case, from what limited facts we know from the media I think the plaintiff has an uphill battle on the claim a home teaching visit is going to support punitive damages. But, who knows . . . juries do funny things—remember O.J. Simpson and Michael Jackson?

Guy,
Interesting. It looks like your procedures in California differ considerably from Illinois. What you describe is essentially bifurcating the matter, allowing a hearing on punitives a week (or more?) later. IIRC that can be done in Illinois, but it’s discouraged and rare. Since, as you note, the whole motion process to obtain leave to demand punitives doesn’t exist in California, I can see why they might have the bifurcated system to accomplish similar protections.

You’re right that a single home teaching visit won’t support punitive damages. The article indicates that the plaintiff alleges he was “frequently” molested by this home teacher, however. The natural course in trying to obtain leave to demand punitives would be to show evidence that this sort of thing (not exactly the same, but reasonably similar) has happened repeatedly. I would not be surprised to find that in the current climate of sex abuse claims against Catholic priests, a judge might be more willing to grant leave than s/he would absent that set of social circumstances. Further, the LDS church evidently settled another similar case for seven figures, rather than comply with an order to disclose financial information. You and I both know judges like to do things to encourage settlement (sometimes that’s good, sometimes it’s not).

I honestly think you’re optomistic to think that a court would not find a home teacher to be an agent of the church. At the very least, they could get hit with negligent supervision, IMHO.

In any case, this is very interesting to discuss from varying jurisdictions, not to mention defense vs. plaintiffs’ attorneys. 🙂

Yes, CA essentially has a bifurcated system as it relates to punitive damages. I don’t know the allegations in the Oregon case. What is different from a home teacher and say a pastor or priest relationship is that the Church is much less involved in the home teaching relationship than it is in say a bishop and member relationship.

I think the plaintiff will have an uphill battle to establish liability against the Church, but particularly for punitive damages. Sure, a home teacher could be considered an agent of the Church; but, certainly sexual molestation would not be considered an activity that would fall within the course and scope of what the Church teaches a home teaching visit would be. Even a negligent supervision verdict against the Church would never support punitive damages against the Church, at least in CA.

It really does take some egregious conduct that can be attributed to the Church or some how ratified by the Church or known by the Church to have been taking place to support those types of allegations. I’d be surprised to see the plaintiff prevail.

Of course the Church could settle at anytime even after the trial starts. But, the fact it is a few weeks prior to trial implies, at least to me, that the Church must think they have some good defenses to this suit. Or, it could also be the settlement demand and offers are so far apart that there is no choice but to try the case. It will be an interesting one to watch.

I would love to see the complaint, and the motions in limine to see how the issues are framed and what kinds of evidence the plaintiff claims he has.

Guy – I was talking about financial disclosure for religious institutions in general, because unlike you and Nick – I’m no expert in civil procedure. Early last year, the Massachusetts House decidedly struck down legislation aimed at forcing the Catholic Church to disclose additional financial information. It’s interesting to watch the political dynamics play out here in Massachusetts between the government and the Catholic Church. Although the Catholic Church is no where near as influential now as the LDS Church is in Utah, many of the same issues of favoritism, undue influence, etc. arise – particularly in the context of the clergy sex abuse scandal.

Back to Oregon – I wonder if the plaintiff is refusing to settle with the Church and instead wants his day in court.

Guy, you make some very good argument, particularly in relation to the home teacher acting outside the scope of his assignment. I do still see questions, however. For example, did this man have a past record as a sex offender? One could argue, rather reasonably, that the LDS church has some responsibility to check out the background of a man, before they assign him to visit one or more times per month with a family which has children. (Mind you, I’m not saying the LDS church is liable–I’m exploring possible arguments.)

You are absolutely correct that a negligent supervision verdict would never support punitives. From what I can see so far, I think it would be very hard under an Illinois-type system for this plaintiff to obtain leave to demand punitives. I’m far too lazy to check into exactly what system Oregon has, but from our discussion so far, I’m betting it’s much more like California, as far as plaintiffs being able to seek punitives without leave of court.

I would really be interested, Guy, in your legal reasoning to support the LDS lawyer’s claim that financial disclosure would violate freedom of religious expression. It appears from your original post that you agree. I can’t say I’ve searched case law on point, but I frankly can’t see how this argument makes any sense at all, unless the LDS church wants to claim that financial secrecy (even from its own membership) is somehow a (newly-minted) tenet of the faith.

So — hypothetically, of course — if this goes down against the Church on both the issue of financial disclosure and on the ultimate merits of the case, does this mean that the Church will have to start conducting background checks before making HT assignments? I mean, are we ready for bishops and EQ presidents to sit down and check ward rosters against sex offender registries?

After seeing what’s happened to the Catholic church in recent years, that might be what it boils down to in order for the Church to limit liability. And unlike the Catholic system of keeping assets separated into individual dioceses (sp?), the Church’s holdings are centralized, so this could really hurt once the blood’s in the water and the sharks pick up the scent. I don’t mean to sound hysterical, but I’ll bet there are some sleepless nights in the Church legal department coming up.

Back to Oregon – I wonder if the plaintiff is refusing to settle with the Church and instead wants his day in court.

My own cynical take as a litigator for the past two decades is that it’s more about the right dollar configuration for this plaintiff, and of course his attorney, than it is about being vindicated in court. If the dollars are there, all the high principled ideals like a “day in court” somehow seem less important.

Of course, I have absolutely no idea what the state of the evidence is. My wild speculation is that if the Church’s counsel feels the plaintiff just doesn’t have the evidence they’re not going to come up with the money it will take for the plaintiff to walk.

On the other hand, if they feel like they have some real exposure here, given the current ruling, that may give the Church more incentive to settle. It will be interesting to watch and see what happens.
Nick,

For example, did this man have a past record as a sex offender? One could argue, rather reasonably, that the LDS church has some responsibility to check out the background of a man, before they assign him to visit one or more times per month with a family which has children.

I have no idea what his background is. Don’t you think your argument would be more persuasive if the individual defendant was being considered as say an Elder’s quorum president, or Bishop, of Stake President for that matter. But a home teacher? Are you really suggesting that the Church is obligated to perform background checks for every home teacher it calls? How about visiting teachers? I don’t think that’s a reasonable solution.

I would really be interested, Guy, in your legal reasoning to support the LDS lawyer’s claim that financial disclosure would violate freedom of religious expression.

Like you, I haven’t researched the case law; but, my argument would be that Church’s have the Constitutional protection to be able to operate without undue governmental influence in their free exercise of religious worship. Something along those lines. The article I referenced above discusses some of the theory behind constitutional protections from governmental intrusion into their finances.

Jim,

I don’t know whether any of the local judges are sympathetic to these types of cases. If there were, I’m certain the Church’s litigators would disqualify those types of judges. Here in CA, an attorney or a party to litigation gets one free disqualification of a judge, no reason needed.

Erelis,

This is the point Nick makes above. I think that is an unreasonable burden, given what the scope of home teaching is vs. the scope of lay leaders like bishops and the like. I also think the liability case would be harder to make against a home teacher and have liability also attach to the Church, like it might with a bishop or stake president.

Regardless, I’m sure the Church’s legal department is monitoring the case quite closely. I am troubled by the comparison some will likely make between this case and some of the prior Catholic cases. I just don’t think the Church has the same history as some of the Catholic cases.

I do agree that if the Church were forced to disclose financial data, the blood would indeed be in the water, and the sharks would be hysterical.

“I think that is an unreasonable burden, given what the scope of home teaching is vs. the scope of lay leaders like bishops and the like. I also think the liability case would be harder to make against a home teacher and have liability also attach to the Church, like it might with a bishop or stake president.”

I’ve read — and this is hearsay of the worst kind, overheard late at night after I’ve cast my bar review books aside — that Oregon law considers any “priesthood” to have an agency capacity. For most churches, that’s synonymous with “clergy” or “pastors” etc, but obviously it means very different things for us. Depending on how strictly Oregon wants to interpret its statutory definition of “priesthood” in this case — and I agree that there’s a strong argument for a distinction between the common definition of “priesthood” and how we use it — every time we go home teaching in Oregon, we could have either implied or apparent authority to act for the church as legal agents. I understand that to be the argument that the plaintiff is making in this case.

I don’t like the implications of that one bit.

I lean a bit toward’s Nick’s position. I don’t know how the Church will successfully argue that freedom of religion prevents the courts from enforcing a religion-neutral law that mandates disclosure of assets in a sexual abuse suit. I don’t think that most people would buy into the argument that freedom of religion extends to financial records, which in my humble view have more to do with privacy than free exercise of religion.

It doesn’t make me happy, but who knows, it might do the church some good to be more open with its finances.

I don’t know how Oregon law defines “priesthood.” It’s hard to believe they have a formal statutory definition; but, perhaps they do. Part of the difficulty with this issue is that we really know so little about what the actual allegations are, what discovery has been produced, what the trial court ruling actually is.

The more I think about it, I’m wondering whether the trial court ruling was something along the lines that the Church must disclose financial data, if liability attaches, and if a jury finds the Church liable for punitive damages. But, I really don’t know. I would like to see what the actual ruling was.

I think the First Amendment not only requires religion neutrality, but also that the law be narrowly tailored to meet a compelling governmental interest. Again, without knowing the text of Oregon’s punitive damage disclosure statutes, it’s a bit difficult to really know what’s going on here.

I think if the Church wants to voluntarily be open with its finances, great. But, I don’t see it as government’s role to require that openness either through sunshine laws or otherwise.

“Compelling governmental interest” is in the eye of the beholder, Guy. NOT to threadjack, but you’ve suggested before that the government has a compelling interest in preventing me from marrying the person of my choice. The standard of “compelling” seems to vary considerably, based on your personal response to an issue. This isn’t an attack on you—it’s something that is the case for every person.

I don’t think so. I think I’ve said there is no fundamental right to marry a person of the same gender. (Which is different from what you suggested above). Therefore, the compelling state interest standard doesn’t really arise. But, as you suggest that’s really another thread.

To bring it back here, I think the plaintiff needs to show the most narrowly tailored vehicle (law) to satisfy that compelling state interest.

As for the compelling state interest argument, it seems to me that you are arguing against a blanket law which requires financial disclosure by religious organizations, rather than against an individual ruling on a discovery matter in a civil case.

The question may be moot. I’ve done very little with regard to non-profit organizations, but it seems to me that the IRS requires annual financial filings, in spite of the organization’s tax-exempt status. I wonder if this information is available under FOIA.

Hello, I’m the author of the Loaded Orygun piece cited above. I’d like to respond that I never said the Church is liable without doing a background check on every home teacher; what I said was that the home teacher is very likely to be seen as an agent of the Church, given that they are assigned by the Church to families to may or may not know them. That they may be family friends either before or as a result of contact is true; that does not however change their status as official representatives of the Church, on Church business.

As to religious freedom, the US Consitution has generally ruled, IIRC, that there is no issue as long as the law treats secular and religious concerns the same. Secular defendants may be ordered to provide financial information to assess the correctness of punitive damages in Oregon; religious defendants are subject to equal scrutiny as well. They cannot claim harm, because they are not being treated differently.

My understanding is that disclosure is not being demanded now, but in the event of a penalty phase after a judgement for the plaintiff. That may not be correct, but it’s how I understand it.

Also, Guy says he’s not sure if the OSC rejected the argument or simply declined to hear the appeal. The article cited above flatly says “rejected an appeal.” Whether they did so by declining to issue an opinion isn’t clear, I suppose, but there you go.

If I remember right…you may have the information I need. I’m over our list-serv, and I heard that in July the First Presidency sent out another political neutrality letter which talked about what was appropriate on official church list-servs. I don’t have a copy of it, even though our bishop has talked about it (and he’s out of town) and would like to see it and send it to the other moderators.

by centralizing all the assets and finances for the entire church, isnt it a known risk that it could all be disclosed, exposed or even lost and made unavailable to all the branches (in this cases units) of the institution.

lets say this is not a settlement related to one individual or a single victim. hypothetically speaking, if the church were to blast asbestos into the air while building a temple or a mall, would the entire assets of the church be at risk? there is no reason to believe that the springville wards assets would be exempt from a settlement, right?

whadya think?

and, if this has been addressed completely (the knowledge of risk aspect) please point me there.

It isn’t just about the settlement. The church doesn’t want its membership to see where their tithing is going and where the church is getting its money. There are assets and businesses that contradict the churches standards for one. For two, they don’t want the people to see what the church spends its money on. It is a very corrupt organization and lives double standards. Rather than help its poor members who pay tithing when they need help and are dying or “get raped” after years of loyalty to the church, the general authorities are living large and spending money on lavish luxuries, mansions and living for free off of their money, and turning a profit off of the money the make with all of the businesses they run (essentially getting richer while the poor people get poorer).

Meanwhile, they tell the people they can’t go to the celestial kingdom and live with their families if they don’t pay tithing, build them temples (pennies in comparison to what they make) and tell them they have to go if they want to go to heaven and keep their family.

However, the general authorities and Mormon celebrities take special temple oaths that make them exempt from following all the Mormon rules. Basically they can do anything they want (“commit any sin” and are automatically forgiven like nephi, Jesus, etc. because to them they are “elite” and so good their sins don’t count which is why they were blessed with wealth and riches and we weren’t).

It’s super fucked up.

That’s why they don’t want people (anyone) to see it. People leave the church and lose their testimonies when they learn the scheme aka truth and then write books about it. Then they have to threaten to kill them them and their families and “curse them” with their supposed Mormon powers.

Those are good questions, for which I don’t really have any good answers. I know the Church in the Oregon case is arguing that if any financial disclosure is required, that it be limited to the Church’s Oregon assets. I don’t know the basis of the argument or any of the legal theories; but, I would like to read the moving and opposing papers.

If I come across them, I will certain do another update post. On one hand, if the intentional tortious activity took place in a certain location, it would make sense to require the financial disclosure in that same region. After all what do the chapels and Temple in Africa have to do with satisfying a judgment of punitive damages in Oregon, USA?

On the other hand, with the Church so centralized (if one can believe the media reports on this) with its finances, others will argue that for a reasonable punitive damage verdict that financial disclosure of the entire worldwide Church would be necessary.

Another point, I would make, is that what really is at stake here in the Oregon case are allegations of conduct against the Church that seek to punish it financially, for that conduct. Your hypothetical of blasting asbestos into the air would likely only be conduct based on negligence rather than on conduct characterized by malice, oppression, or fraud. There is a difference not only in the conduct but also in the type of damages that can be awarded.

My major beef with these or similar allegations is that the disclosure should not even be considered unless and until there is a finding not only of liability by the Church but also of conduct attributable to the Church or its agents that would support punitive damages.

If I come across further information, I’ll post it. I’m working on a couple of angles.

i see your point. and honestly, i too am curious why the plaintiff needs to use the financial assets in advance of having a decision related to actual crappy alleged acts.

though, i do not see why there would be any distinction between malice or negligence, intentional or unintentional. if bad things happen, for whatever reason, there are consequences. intent and ignorance or not a factor, imo.

as for your suggestion that damages be limited to oregon assets – there are no oregon assets. none. zilcho. ALL assets belong to the corporation of the president or lds church. all income is returned to the central office and disbursed, there is no oregon based center that receives and disburses.

true, africa chapels are not so relevant to the case, including my hypothetical case. but, again, if the church chooses to centralize everything, they also are choosing to centralize risk, not just wealth. they are centralizing liabilities, including unknown liabilities based on the actions of employees, volunteers and clergy, no?

if we were to have this same conversation about a corporation, such as chrysler, we would not consider anything that was moved offshore or not based in oregon to be off limits to litigation.

while this may be a loose comparison, imagine making your same argument as it relates to exxon valdez. what if the only assets available to plaintiffs, the state and citizens were assets and cash based in alaska? or better, assets and cash located or central to the Aleutian islands. sorta silly eh?

though, i do not see why there would be any distinction between malice or negligence, intentional or unintentional. if bad things happen, for whatever reason, there are consequences. intent and ignorance or not a factor, imo

The legal distinction is in the types of damages available to the plaintiff. In a simple negligence case, based on negligent (i.e., accidental), rather than intentional conduct the plaintiff may only collect what are called compensatory damages. These are meant to compensate a plaintiff for special damages, incurred, i.e. medical bills, wage loss, property damage. They are also meant to compensate for the more nebulous concept of general damages, or pain and suffering.

A defendant’s net worth is completely irrelevant when a judge or jury awards these types of damages. They are what they are, regardless of a defendant’s net worth or ability to pay.

Intentional conduct, or conduct reflecting malice, oppression, or fraud is the only type of conduct that will support an award of punitive damages. These types of damages are meant to punish the defendant, rather than compensate the plaintiff. In theory, the plaintiff will claim to need to know a defendant’s net worth in order for a judge or jury to know whether the punitive award is too much, too little, or just right (sort of like Goldilox and the three bears).

Clearly there are Oregon assets, just as there are San Francisco or Los Angeles assets. They can be evaluated and appraised as local assets just as they can be considered part of a larger whole. I just don’t know the arguments the Church is using in the Oregon case, or the legal theories; but, I understand they are arguing Oregon assets only. I’m just not certain how they are making the argument.

Thanks for this link. From the story, it does not sound like a punitive damage award. It uses terms like negligence and misconduct. Furthermore, there has been no disclosure (at least to my knowledge) by the Church of its finances from the time of this case to the present.

The facts also lead me to believe the award was based only on negligent conduct rather than by conduct supporting a punitive damage award. And, the article doesn’t mention anything about a punitive damage award, only a large jury verdict.

But, to answer your question, if the award was a punitive damage award, the Church would likely been ordered to disclose financial information. It is typical that in a punitive damage fact pattern, that a defendant has to provide evidence of its financial worth.

Finally, I would agree with the Church’s counsel that based on those facts, the Church would have an excellent legal appeal. I don’t know what happened in this case, whether it eventually settled or what.

i just had a long elaborate and polite post wiped out because i forgot to include an email address.

here is the abbreviated version. there was a case similar to the washington case that went to a jury in texas:

John Charles Blome
This civil case was filed in Montgomery County, Texas and went to jury trial. The case settled for $4 Million after the Mormons were found negligent. A 13 year old boy who was molested by a Mormon Church youth leader in Magnolia Ward was awarded more than his own lawyers sought October 8, 1998. Blome molested many other boys from the same area and in other areas. Sheriff’s deputies were upset that the Mormon Bishop tipped Blome to the pending investigation, and he burned evidence before it could be seized. In an earlier case against Blome the Mormon Church was also found negligent.

perhaps, after going to trial and insisting that they would appeal, the threat of financial disclosures motivated a settlement in texas.

additionally, here is a contribution to the salt lake tribune from Sheila R. McCann:
——
Confidential Settlements: A shield of privacy surrounds the LDS Church’s resolution of complaints about its handling of child sexual abuse, making it impossible to define the total number of claims, informal and formal, and the amount of money paid by the church.

Not even the amounts paid to resolve publicly filed lawsuits can be ascertained, because confidentiality is a routine requirement for a settlement. Even the end result of the lawsuit that snared a $4 million jury award last year is not public. The church initially said it would appeal, then negotiated a confidential settlement with the molested boy.

In 1993, after a California jury found the LDS Church liable and decided it should pay punitive damages in the molestation of a 13-year-old girl, the trial was halted and the case settled before jurors considered how much to award.

Of the more than 40 plaintiffs, Keetch contends the church has either won dismissals or paid limited settlements — equivalent to the legal expense of defending the case — in nearly all cases. Only about seven settlements have been in amounts higher than that benchmark, he said.

—-

your point, that punitive damages may require or merit financial disclosure, is fascinating. i am curious how that factors into these other cases. i think there was a very large case in virginia as well. i suspect you know more about it than i do.

regarding the cavalieri case, the victim was posting in the bloggernacle shortly after the trial. strange eh? i suspect the poster may have been a poser, but it seemed legit. i remained skeptical of the posters real identity, but found it interesting nonetheless. as you know, i am banned from every bloggernacle venue imaginable, so if you are interested in reading any of that, you are on your own. i would hate to satanize the bloggernacle sites by doing a search.

[…] Church Set For Mediation (Update) Posted by Guy Murray under Lawsuit , LDS Church The Oregon sexual abuse case against the Church is no longer headed for trial in August, as earlier media reports suggested. […]

I think a Mormon wrote this article. Can you be any more right wing towards the church and any further left wing towards criticizing the victim and anyone who dared question the churches liability and the perpetrators?? Home Teacher is an official calling…and believe the victim. Always…